Posts filed under ‘Alvarion’

Nortel Bankruptcy and Costs Pushes Alvarion into Quarterly Loss

Israeli WiMAX vendor, Alvarion, which recently had to break up its mobile WiMAX deal with Nortel has swung into a fourth-quarter loss due a restructuring charge and the Nortel problem. The firm reported a quarterly loss of US$4.8 million, compared to a profit of US$12.4 million a year ago. Revenues rose 6 percent to $70.1 million, a decrease of 6% from $74.3 million in the third quarter of 2008, and increase of 6% from $66.3 million in the fourth quarter of 2007.Excluding a restructuring charge of US$3.4 million and other one-off items, the company reported a net income of $119,000, down from $3.1 million a year ago.

The sequential decline in revenues was primarily a result of Alvarion’s inability to recognize $2.4 million of revenues from the sale of products to Nortel Networks during the fourth quarter of 2008 after Nortel filed for bankruptcy protection in January and subsequently repudiated the joint WiMAX agreement between the two companies. The decline in Q4 gross margin was due to the write-off of the cost of the equipment related to the Nortel sales in the period.

Wireless Industry News

February 5, 2009 at 13:21 Leave a comment

Nortel exits Wimax business, Alvarion deal

Nortel Networks has pulled out of a deal to resell mobile Wimax equipment from Alvarion and help fund development of Alvarion’s Wimax base stations. The network equipment maker partnered with Alvarion last June after cutting back its own Wimax efforts. Alvarion said that the collapse of the deal will take USD 0.04 per share off its fourth-quarter profits, due to be announced 4 February. As a result the company will report a loss of USD 0.08 per share, includign 6 cents for earlier announced restructuring measures. The company won’t be able to recognize about USD 2.4 million in revenue from sales of products to Nortel in the quarter. This will put sales at around USD 70 million for the quarter, at the low end of its earlier guidance of USD 70-78 million. Nortel filed for bankruptcy protection earlier this month. Nortel said it will work closely with Alvarion to make sure it can continue to support existing Wimax customers. Nortel is obligated to pay Alvarion for certain research and development services beyond the fourth quarter, but in the wake of the bankruptcy, Alvarion said it’s not certain whether it will be able to collect. The companies are working on shifting over their joint Wimax customers to Alvarion.

Wireless Industry News

January 30, 2009 at 14:00 Leave a comment


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